AI Drafter - (New and Powerful) 
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter. 
TaxTMI 
TaxTMI 
2022 (6) TMI 1312
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (3) The petitioner herein is a Director in respondent No.5 Company run by her husband and others. (4) Respondent No.5 availed a loan from the respondent No.2- Bank for which the petitioner stood as a guarantor along with others. (5) There was a default committed by respondent No.5 in servicing the loan availed by it from respondent No.2 and so the said respondent recalled the loan by issuing the demand notice dt. 22.11.2021 to respondent No.5 and its guarantors including the petitioner under Section 13(2) of the SARFAESI Act, 2002 demanding a sum of Rs.121,17,11,148.70. (6) It is stated by petitioner that one of the operational creditors of the respondent No.5 filed on 02.09.2021 an application under Section 9 of the IBC, 2016 CP(IB) #239/Chd/Hry/2021 before the NCLT, Chandigarh and when the matter had come up on 13.4.2022 and orders were reserved in the said case. (7) Respondent No.5 also filed a petition before the NCLT, Chandigarh under Section 10 of the IBC for initiation of CIRP of respondent No.5 and the said application is said to be under scrutiny before the NCLT. (8) According to the petitioner, respondent No.5 through one of i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ioner and respondent no.5 of the same, and that the action of the respondent Nos. 1,3 and 4 in not furnishing even a copy of the said LOC to her was illegal and arbitrary. (17) Counsel for the petitioner relied upon the decisions in Maneka Gandhi vs. Union of India (1978) 1 SCC 248 and Satish Chandra Verma vs. Union of India & Ors (2019) SCC Online SC 2048 and contended that a citizen of the country had a constitutional right to go abroad; such a right cannot be prevented from being exercised without due process of law and without observing the principles of natural justice. He placed reliance on the decision of the Supreme Court in State of West Bengal vs. A.B.K. Ltd (2015) 10 SCC 369, to contend that an un-communicated order, such as the impugned LOC, has no legal effect and would take legal effect only when the same is communicated to the affected party. (18) Counsel for the petitioner further contended that petitioner is not an 'accused' in any criminal case evading the process of law, that no criminal case has been registered against her and there is no declaration issued either that she committed any fraud or that she was a willful defaulter by any competent authority a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....agencies take lot of time to discover the fraud and the modus operandi of the defaulters in siphoning off and diverting the bank loans and funds, the defaulters attempt to leave the country, and so in 2018, the Government of India had issued a notification empowering the Public Sector Banks to seek issuance of LOCs in case loan defaulters are trying to leave the country without paying huge debts. (26) It is stated that if the petitioner is allowed to travel abroad without joining investigation and without repaying her pending debts, economic interest of India will suffer. (27) Reference is made to certain Office Memoranda issued regarding issuance of LOC by the Ministry of Home Affairs, Union of India. (28) Request is lastly made to adjourn this matter till the Supreme Court decides the SLP No.7733 of 2022 filed against the order dt.5.4.2022 in CWP No. 5492 of 2022 by this Court in the case of Noor Paul. Stand of respondent Nos. 1, 3 and 4 (29) Respondents No.1, 3 & 4 have filed a short reply admitting that they had issued the LOC dt. 28.12.2021 at the instance of respondent No.2 preventing the petitioner from travelling abroad on 22.02.2022. (30) It is averred th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d a rejoinder reiterating that Mrs. Bahaar Grover is her eldest daughter, that she got married to Mr. Robin Grover in 2012 and then she moved permanently to Australia in 2013 and that was why she was not included in the list of the legal heirs given to respondent No.2 by her and her husband. (39) To prove that Mrs. Bahaar Grover and the petitioner are daughter and mother, copy of the Matriculation Mark sheet dt. 28.05.2002 issued by the CBSE and relevant pages from her old passport have been filed as Annexures P-18 and P-19 have been placed on record. (40) Reference is also made to Annexure P-16 at Page 66 of the Papers filed alongwith the Writ Petition, which is a certificate dt. 19.04.2022 issued by Dr. Melissa Mckenzie, an Obstetrician and Gynecologist at Greenslopes, Queensland, Australia that Mrs. Bahaar Grover is being provided antenatal care by her and that the delivery is planned by elective caesarean section on 28.07.2022. (41) It is reiterated that petitioner has to take care of her daughter during the prenatal and post natal period and therefore she needs to visit Australia so that she can be a source of comfort to her during this sensitive phase. It is further ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nk that after the order was passed by this Bench on 05.04.2022 in CWP No.5492 of 2022, the petitioner created a story about going to Australia to avoid paying the debts of respondent No.5 to respondent No.2. It is unfortunate that the respondent No.2-Bank has chosen to take the said stand, which is in bad taste. The right to travel abroad is enshrined in Art.21 of the Constitution of India (52) Way Back in 1967, the Supreme Court in Satwant Singh Sawhney vs. D.Ramarathnam, Asstt. Passport Officer AIR 1967 SC 1836, held that the right to travel abroad falls within the scope of personal liberty enshrined under Article 21 of the Constitution of India and that no person can be deprived of his right to travel except according to the procedure established by law. (53) In Maneka Gandhi ( 1 supra), a 7-judge Bench of the Supreme Court in 1978 declared that no person can be deprived of his right to go abroad unless there is a law enabling the State to do so and such law contains fair, reasonable and just procedure. It held: " 5. ...Thus, no person can be deprived of his right to go abroad unless there is a law made by the State prescribing the procedure for so depriving hi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Court held that there should be communication of an order adverse to a citizen and only then it would come into effect. (61) Without communicating the LOC to the petitioner, the respondents cannot seek to enforce it as it would not have any effect in law. (62) We are of the opinion that the respondent 1,3 and 4 have not followed fair, just and reasonable procedure to deprive the petitioner of her fundamental right to travel abroad as they have not followed the principles of natural justice and did not even supply a copy of the LOC to petitioner inspite of her request to do so. (63) In Karti P.Chidambaram vs. Bureau of Immigration (2018) SCC Online Mad. 2229, it was held that legality and/or validity of an LOC is dependent upon the circumstances prevailing on the date on which the request for issuance of the LOC has been made. (64) In the request for issuance of LOC made on 28.12.2021 by the respondent No.2 to the respondent No.3 placed before us by the counsel for Respondents 1, 3 and 4, there is no mention that the petitioner is an accused in any criminal case initiated by the respondent No.2. Even Annexure thereto leaves blank the column "FIR No. date.". (65) Ann....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... reply/affidavits and recourse could not have been taken for a coercive process like issuance of LOC. (70) The plea of respondent No.2 that quantum of loan taken by the petitioner is huge, and if the petitioner were to leave India, there would be a substantial dent in the economic interest of the country cannot be accepted because the loan was not given to the petitioner in the first place, but to respondent No.5, and the petitioner was only a director/guarantor to the loan given to respondent No.5 as on the date of issuance of LOC. Also not even proceedings to declare respondent No.5 or any of the directors/guarantors as 'willful defaulters' have been initiated by respondent No.2 as of date, much less filing of a criminal case against the petitioner or others. (71) We are of the opinion that the quantum of the alleged default by the borrower by itself cannot be the basis for seeking issuance of an extreme process like an LOC for restricting the personal liberty of the petitioner to travel outside the country without something more. The OM itself does not draw any line about the quantum of default by a borrower to a financial institution which would be considered detrimental ....